When loading a char in P2 only Zofis will work, the other story mode-only characters are missing the AI files and will crash the game.
The Baltro, Pamoon, and Demolt stages will not work properly as standalone stages. Arcade/Gallery Mode shows this can be fixed but I haven't found how.

Game runs at 512x448 on the PS2, on GC 640x448, and the textures are all available as TPLs on the disc you can tell that they left the textures as is and without filtering.
Here's a Devolution screenshot https://i.imgur.com/znpCNj9.png it looks all jagged!
And here's one of the textures https://i.imgur.com/MhjHGxa.png
It definitely doesn't look that bad on my TV though, I even displayed the screenshot there and it looked the same as the game.
Because of that I can't really tell if the 512x code works and Dolphin doesn't play nice with it.

Because the extra characters have weak attacks and low HP, this code will let you customize each slot.
Every character has different stats, that means using a global value would be bad but it's hard to tell anyway.
So changing P2's HP to 0x0A will make them weak enough for Laila(or any other) to beat. You can remove the lines you don't need. (There's no need to mess with P2's spell meter)
And change P1's MP to 0x01, the only catch is that changing MP won't change the "speed of recovery" which is nearly instant for the extra characters.

What if you don't want to change existing character slots and still use the new characters?

You can use the -Development Data- section of the CSS, that gives you 80 extra slots!
If you don't use this feature normally it's a great solution. Here's how the code changes:

If you're loading data on memory card in slot A, zz = 01, if you're loading from slot B in addition to slot A, zz = 01
Here's where it might get confusing, if you're loading from slot A but NOT from slot B but you still have a card inserted in B then zz = 00, this needs more testing.
2853DE78 0000zzxx // Remember how the last normal slot is 0x13(Victoream)? For developed chrs the first slot begins at top left as 0x14, and ends at bottom right as 0x3B for Slot A (40 slots)
0453DDE8 000000yy // the rest is the same, but for Slot B (40 more slots) it begins at 0x3C and the last slot is 0x63
E0000000 80008000